ETHICS COMMITTEE FAULTS TORRICELLI ON GIFT VIOLATIONS

This article was reported by David Kocieniewski, Tim Golden and Carl Hulse and written by Mr. Golden.

Published: July 31, 2002

WASHINGTON, July 30—
The Senate Ethics Committee tonight ''severely admonished'' Senator Robert G. Torricelli of New Jersey, saying he had violated Senate rules by accepting and failing to disclose expensive gifts from a former contributor to whom he repeatedly gave help.

On the basis of thousands of pages of information developed in an earlier federal inquiry into Mr. Torricelli's activities, the committee chastised him for using poor judgment and disregarding Senate rules in his dealings with the former donor, David Chang.

''Your actions and failure to act led to violations of Senate rules (and related statutes) and created at least the appearance of impropriety,'' the three Democrats and three Republicans on the committee said in a three-page letter to Mr. Torricelli, a Democrat. [Excerpts, Page B6.]

The ethics panel also ordered Mr. Torricelli to pay back Mr. Chang -- with interest -- for the full value of a large-screen television and compact-disc player and for expensive earrings the businessman gave to Mr. Torricelli's sister, a close aide and one of his former girlfriends.

Within minutes after the committee released its letter publicly, Mr. Torricelli took the Senate floor tonight to apologize to the people of New Jersey for allowing his seat in the chamber ''to be placed in this position.'' [Transcript, Page B6.]

The ethics panel, to which evidence from the criminal case was forwarded, concluded its review just as Mr. Torricelli is gearing up his campaign for re-election against the Republican candidate, Douglas R. Forrester. After months in which polls showed Mr. Torricelli well ahead of his relatively unknown Republican rivals, the contest has narrowed in recent weeks.

It was the first time that the Senate Ethics Committee voted to take action against a senator since 1995, when it recommended that Bob Packwood, an Oregon Republican, be expelled on the ground of sexual and official misconduct. Mr. Packwood later resigned.

Senator Daniel K. Inouye, who led the ethics inquiry, said he believed the investigation was thorough and fair but would not offer a detailed description of the committee's secret deliberations. ''The document speaks for itself,'' said Mr. Inouye, who added that he considered the matter closed with the letter.

During nearly seven hours of sworn testimony last week before the members and staff of the ethics panel, Mr. Torricelli argued that he had not taken any gifts from Mr. Chang, saying that what items he had accepted from the businessman he had later paid him back for, one person familiar with his account said.

Mr. Torricelli also insisted that he had not done any unusual favors for Mr. Chang, who first turned to the senator in 1995 for help in winning the repayment of some $71 million he said he was then owed in a failed business deal with the North Korean government.

The ethics committee was unconvinced.

In its letter, which was signed by all six members, the panel wrote that it was ''troubled by incongruities, inconsistencies and conflicts, particularly concerning actions taken by you which were or could have been of potential benefit to Mr. Chang.''

The committee criticized Mr. Torricelli for maintaining a ''personal and official relationship with Mr. Chang under circumstances where you knew that he was attempting to ingratiate himself, in part through a pattern of attempts to provide you and those around you with gifts over a period of several years.''

During that time, the panel said, Mr. Torricelli and members of his Senate staff took a series of actions to help Mr. Chang, contacting American government officials, writing letters to foreign governments and bringing Mr. Chang or his business representatives into meetings with foreign officials.

The committee did not confirm some of the most serious of Mr. Chang's allegations, including his claim that he gave the senator tens of thousands of dollars in cash.

The committee said it had weighed the fact that the credibility of Mr. Chang, ''has been called into question by the Department of Justice, a United States District judge and his own conduct.''

But at the time of Mr. Chang's sentencing, the federal judge, Alfred M. Wolin, also said the businessman had cooperated closely with federal investigators, providing them with information that was ''material and credible.''

The ethics committee has the power to punish lawmakers with sanctions ranging from public or private letters of admonition to censure or expulsion. In Mr. Torricelli's case, it acted without conducting a full investigation, saying the case had been exhaustively scrutinized by federal authorities.

A lawyer for Mr. Chang, Bradley D. Simon, said tonight that he was disappointed that the ethics panel had confirmed only a handful of the gifts he said his client had given Mr. Torricelli and had not dealt with what he said were actions by the senator to thwart the federal investigation. ''This matter was far more serious than what the committee found,'' Mr. Simon said.

According to two government officials involved in the inquiry, the ethics committee received a vast amount of information from federal investigators, some of it under a court order issued in March.

That information included witness statements, store receipts and other documents indicating that Mr. Chang had paid for expensive items that were given to Mr. Torricelli, his sister, one of his longtime aides, Roberta Stern, and one of his former girlfriends, Judy D. Balaban.

The committee's letter did not mention gifts that Mr. Chang said he had made to the senator of an $8,100 Rolex watch, about a dozen Italian-made suits and a $3,816 antique grandfather clock.

Nor did it cite a $1,590 Oriental carpet that Mr. Chang gave to Mr. Torricelli's former wife, Susan Holloway Torricelli. A government official involved in the inquiry said that evidence of those gifts was either incomplete or the subject of conflicting accounts by different witnesses.

The committee confirmed Mr. Torricelli's claims that he had made partial repayments to Mr. Chang for two gifts: a large-screen television set and a stereo compact-disc player. But it said the senator had showed ''poor judgment'' by failing to reimburse him for the full market value of the gifts.

A person familiar with Mr. Torricelli's testimony to the committee said he had told its members that he repaid the wholesale cost of the appliances because Mr. Chang told him that was what he had paid.

The ethics panel also criticized Mr. Torricelli for taking two bronze statues on loan from Mr. Chang. The statues, the existence of which had not been publicly known before, were displayed in Mr. Torricelli's Senate office.

Finally, the committee appeared to have discounted Mr. Torricelli's contention that he was not responsible for expensive earrings that Mr. Chang had given as Christmas gifts to his sister, Ms. Stern and Ms. Balaban.

The senator's belief ''that such items were of little value or were not gifts to you under the circumstances'' displayed poor judgment and violated Senate gift rules, the panel found.

According to a government official involved in the inquiry, the information reviewed by the committee also included an analysis by federal investigators showing that during the period in which Mr. Chang said he had made numerous cash payments to Mr. Torricelli, the senator spent thousands of dollars more in cash than investigators could account for from his bank withdrawals and other known sources of income.

The analysis, which was assembled from banking and credit records, income-tax returns and congressional financial-disclosure forms, showed by March of 1998, Mr. Torricelli's cash expenditures were more than $22,000 in excess of the cash he had generated from checks and automatic-teller machines, an official who has reviewed the document said.

A spokeswoman for the senator, Debra DeShong, said he had fully accounted for all the money he had spent.

''Senator Torricelli provided the committee with a full explanation of sources of income and any funds used for cash purposes,'' she said.

Moving quickly to make a campaign issue of the Senate letter, Bill Pascoe, Mr. Forrester's campaign manager, said the findings were evidence that Mr. Torricelli had undertaken an ''extensive campaign of misinformation and deceit,'' and called on him to release the sworn testimony he gave to the panel.

Mr. Pascoe said, ''Only then will New Jersey voters be able to decide Mr. Torricelli's fitness for office.''

Senatorial Rebukes

These are recent disciplinary actions against senators by the Senate or its ethics committee:

1990 -- Senator David Durenberger, a Minnesota Republican, is denounced by the Senate for financial misconduct involving guest- speaking fees and real estate deals. He was ordered to pay more than $124,000 in restitution.

1991 -- Senator Alfonse M. D'Amato, New York Republican, is reprimanded by the ethics committee in 1991 for improper use of his position to help campaign contributors.

1991 -- The ethics committee rebukes Senator Alan Cranston, a California Democrat, for interceding with regulators on behalf of the former savings-and-loan operator Charles H. Keating Jr. in exchange for campaign contributions.